How Finnfund can take more risk in fragile states and pioneering projects

Finnfund raises half its project funding from private markets and is less capitalised than its Nordic sister organisations. A new special guarantee scheme is designed to make Finnfund able to invest in pioneer projects and fragile states, without jeopardising its trust with lending banks.

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The stakes are high for the UN environmental agency (UNEP) in the wake of an on-going audit which reveals excessive travel costs incurred by the agency’s leadership. Denmark, the Netherlands and Sweden are holding back EUR 16 million in grants that were originally planned to be disbursed this year.

As the Global Financing Facility (GFF) gears up for its first replenishment next month, there are warnings that by making poor countries take up World Bank loans, the ambitious health scheme could lead to increased indebtedness.

Thematic priorities like clean oceans and renewable energy investments are winners in a growing Norwegian aid budget. Support for fragile states, stemming migration and combatting terror are other top priorities, while civil society and core funding to UN agencies benefit less.

In a donor landscape where most aid management is either delegated to a separate directorate or integrated into a foreign ministry, Norway is the only OECD country that splits grant management between a ministry and its aid agency, according to a new report commissioned by Development Minister Nikolai Astrup. This, the report concludes, creates both inefficiency and confusion.

A team of experts from UN headquarters in New York is helping the Nairobi-based UN Environment Program get its financial house in order. Following a critical audit, a new deputy has been given a key role in the agency’s sweep up, and Erik Solheim pledges to spend less time on the road.

Norwegian result payments for Indonesian forest protection have not materialised nine years after a cooperation agreement was signed. An evaluation urges Norway to make its first carbon payment by 2020 and concludes that the bilateral deal is still relevant.

General budget support, a popular instrument in the aid tool box during the 2000s, was effective and cheaper than project aid. Donors abandoned it because of their latent mistrust of recipient governments, a new study concludes.

Sweden will not pledge funding for the Global Financing Facility (GFF) health initiative at a donor meeting in Oslo next month.
“We have a health architecture that is already very crowded, and we do not think that we need a new structure,” says Anders Nordström, Sweden’s Global Health Ambassador, to Development Today.